BlueMountain Capital Management – which made gains of about $30m by making bets opposite JP Morgan last May, according to The Wall Street Journal – announced the appointment of Staley as a managing partner today.

It remains unclear when Staley will leave JP Morgan.

Staley had been chief executive of JP Morgan’s investment bank until July last year, when he was moved to a new role as chairman of the corporate and investment bank as part of a wider reshuffle.

The overhaul saw JP Morgan's investment banking, corporate banking and treasury and securities services units under one roof. Daniel Pinto and Mike Cavanagh were named as co-chief executives of corporate and investment banking as part of the shake-up.

Once considered a frontrunner to replace Jamie Dimon as chief executive, Staley departing became a possibility following the switch out of the day-to-day spotlight.

He was also touted as a potential replacement for Bob Diamond as chief executive of Barclays, after the UK bank lost its chief executive in the wake of the Libor scandal – although did not get the job, the WSJ reported in October.

Baltimore asset manager Legg Mason also approached Staley to discuss its chief executive position last autumn, according to a report by CNBC.

At BlueMountain, Staley will become one of nine managing partners and will focus on cultivating relationships and developing new strategies. He is purchasing a stake in the firm – the proceeds of which will be re-invested into infrastructure, technology and talent – and will join its management, risk and investment committees.

Although BlueMountain reportedly profited from JP Morgan’s losses last summer, the firm later switched to helping the bank unwind its massive trades in credit derivatives.

One person familiar with the matter told Financial News in December: “JP Morgan got caught with its pants down and BlueMountain helped it pull them back up, and made some nice money on the spread. JP Morgan took less of a hit than if it had sold in big blocks on the open market.”

The firm posted a 1.43% gain for June in its $4.5bn Credit Alternatives Fund, taking its return for the first half of the year to 10.17%, according to a letter sent to investors and seen by the WSJ in July.

The fund’s performance beat both the June and first-half returns of the hedge fund industry and the broad credit market index.

In joining BlueMountain, Staley will work alongside fellow ex-JP Morgan banker Andrew Feldstein, a former credit derivatives trader who co-founded the firm in 2003.

Staley had been with the US’s largest bank by assets for more than 34 years, holding a number of senior positions over that period. Prior to becoming head of investment banking in September 2009, following the departure of Bill Winters, he had been JP Morgan’s head of asset management.

Prior to that, he had been served as the head of JP Morgan's private bank and was one of the founders of its equities business.

Staley said: “I'm very excited to be joining BlueMountain at a time when sea changes in the financial industry combined with the firm's unique strengths open up enormous possibilities to deliver value to clients.”

He added: "I want to thank all my colleagues at JP Morgan, my home for the last 34 years, and I look forward to working with them in the future."